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State Legislative Update

May 29 - June 9, 2000

		Government Affairs Newsletters Washington Updates Hey, Wait A Minute State Legislative Updates Through the Grapevine

Antitrust

In Ohio, Representative Trakas introduced H.B. 721 on May 24, 2000. This legislation was immediately assigned to the House Rules Committee, read twice and then referred to the House Committee on Commerce and Labor all on the same day. H.B. 721 would allow healthcare providers to collectively bargain with health insurance carriers over non-fee-related contract provisions. In addition, this measure would allow providers to jointly negotiate fee-based provisions under specified circumstances. Joint negotiations by healthcare providers would be subject to regulatory oversight by the state Attorney General and Superintendent of Insurance, and the measure would sunset three years after the effective date of the act.

Children Health Insurance Program (CHIP)

Legislative action regarding CHIP was taken in two states—Colorado and New York. In Colorado, S.B. 223 was introduced to the Senate Committee on Health, Environment, Welfare and Institutions on April 12, 2000. On June 3, 2000, the Governor signed the bill, which makes changes to the non-Medicaid state-subsidized insurance program known as the "Children’s Basic Health Plan."

In New York, on June 5, 2000, A.B. 10161 was re-assigned to the Assembly Committee on Rules. This bill provides that children who are under 19 years of age and are both in receipt of medical assistance pursuant to the state social services law and are enrolled with a managed care program are, upon termination of their state medical assistance benefits, presumptively eligible for enrollment in a CHIP health plan offered by a managed care provider.

A.B. 8392 was introduced in New York on May 17, 2000 and on June 5, 2000 the bill passed the Assembly Committee on Rules. This legislation would provide coverage for emergency medical transport services under the state’s CHIP pursuant to a prudent layperson standard.

Genetic Discrimination

Legislation concerning genetic discrimination in insurance was considered by lawmakers in California, New Hampshire and New York. In California, Assembly Member Papan introduced legislation to prohibit any insurance producer or underwriter from disclosing any individually identifying information about a customer’s health, medical or genetic history. On May 25, 2000, A.B. 2797 passed the Assembly and was referred to the Senate.

In New Hampshire, the Conference Committee for H.B. 1589 was approved on May 31, 2000. This measure, which was sponsored by Representative Kurk, would prohibit the use of genetic testing when underwriting certain life and long-term care insurance policies.

The New York legislature took action on A.B. 3435 on May 24, 2000. The Assembly passed this measure, and then the bill was referred to the Senate Committee on Rules. A.B. 3435 would prohibit carriers from denying or canceling certain life and disability policies based on genetic information about an insured person or a member of his/her family. It would also prohibit the carriers from requesting genetic information from an insured individual or a member of his/her family.

Also in New York, the Assembly Committee on Rules introduced A.B. 11155 on May 25, 2000. This measure was immediately assigned to the Assembly Committee on Insurance. According to this bill, discrimination on the basis of DNA test results during the insurance underwriting and rating process would be prohibited. Carriers would be prohibited from asking about the results of DNA or other genetic tests during the insurance application process.

Health Plan Liability

In Alaska, the Governor signed H.B. 211 sponsored by Representative Rokeberg on June 1, 2000. This measure establishes the civil liability of managed care entities that do not exercise ordinary care when making treatment decisions. Also included in this measure is a requirement that health plan contracts need to clearly identify all healthcare services that the plan provides and covers, as well as the plan’s utilization and external review processes.

On May 18, 2000, in North Carolina, S.B. 1326, sponsored by Senator Wellons, was held as filed in the Senate. This bill would establish the liability of health benefit plans for damages for harm to enrollees caused by the failure of the plan to exercise ordinary care. Liability could not be extended to employers that offer health plan benefits to employees unless the employer makes healthcare treatment decisions. The enrollee would be required to complete all internal and external appeals before filing a claim of liability.

Long-Term Care

Action was taken on long-term care legislation in Alabama and California. In Alabama, H.B.170 was signed into law on May 25, 2000. This legislation, among other things, establishes the Long-Term Care Insurance Minimum Policy Standards Act in the state and provides for the regulation of long-term care policies by the state Commissioner of Insurance.

California S.B. 2111 was read for the second time in the Senate on May 23, 2000 and amended. On May 25, 2000 the legislation was assigned to the Special Consent Calendar. This bill, which was introduced by Senator Dunn, would amend existing law concerning the consumer long-term care guide to include sections on rate histories and policy comparisons. In addition, the long-term care personal worksheets used by agents must include a reference to the rate guide along with information on where copies may be obtained.

Also in California, A.B. 2265 by Assembly Member Aroner passed the Assembly Appropriations Committee on May 24, 2000. This measure would establish a definition for palliative care and add this definition to existing statutory provisions relating to Medi-Cal and long-term care insurance policies.

Managed Care Reform/ Patient Protection

Senator Brown-Waite, of Florida, sponsored S.B. 1508, which was sent to the Governor on May 30, 2000. This measure would define a "clean claim," as a completed claim filled out on the correct form and submitted by an enrollee’s physician for medical care or healthcare services that were provided under a health plan. This measure also specifies procedures that the health plan must follow in order to contest a claim.

Four bills in Michigan related to managed care reform/patient protection had recent legislative activity. H.B. 5572, introduced by Representative Woronchak, passed the House and was then sent to the Senate Committee on Health Policy on May 30, 2000. This measure would require the state Insurance Commissioner to create an HMO consumer guide. For each HMO in the state, the guide would list the following: (1) national accreditation with any limitations that were imposed, (2) the quality-of-care rating for each HMO and (3) a toll-free number set up by the Commissioner to receive inquiries or complaints. The Commissioner would be required to request information from the HMOs to determine the quality-of-care ratings.

In the Michigan Senate, Senator Shagars introduced S.B. 1210 on April 12, 2000, which is similar to H.B. 5572. On May 24, 2000 this measure passed the Senate and was referred to the House Committee on Health Policy.

Representative LaSata introduced H.B. 5576 in Michigan on April 12, 2000, and on May 30, 2000 it passed the House and then was referred to the Senate Committee on Health Policy. This measure would allow enrollees who were denied coverage to obtain an external independent review of the denial. Enrollees would be required, before requesting an external review, to exhaust all internal review processes and then notify the state Insurance Commissioner. After evaluation, the Commissioner would then notify the plan of the request for an external review.

S.B. 1208, a similar measure to H.B. 5572, was sponsored by Senator Schwartz in Michigan. On May 24, 2000, it passed the Senate and was then referred to the House Committee on Health Policy.

In New Hampshire, on May 30, 2000, H.B. 1377, which was sponsored by Representative Martel, was ordered enrolled. This bill would prohibit managed care organizations from excluding healthcare providers that are not certified by the American Board of Medical Specialists from the organization’s network. A committee would also be established by this bill to study the methods managed care organizations use to contract with healthcare providers.

The Governor of Oklahoma signed H.B. 2072 on June 5, 2000. This bill, which was sponsored by Representative Morgan, amends the Oklahoma managed care act. H.B. 2072 establishes that health benefit plans could not deny emergency care coverage due to a lack of prior notification. If a patient or layperson believes that a condition is serious and needs medical attention, then the patient’s screening, evaluation and examination to determine condition status will be covered. However, if a provider later determines that the patient’s condition is not an emergency, then all other care is not required to be covered by the plan.

Also in Oklahoma, S.B. 1588 was sent to the Governor on May 26, 2000. This measure, which was sponsored by Senator Monson, relates to the Oklahoma managed care act by modifying definitions of terms used in the act.

Senator Cooper in Tennessee sponsored S.B. 1573, which was substituted by a similar bill, H.B. 1192, on May 31, 2000. H.B. 1192, which was sponsored by Representative Kisber, passed the Senate on May 31, 2000. Managed care entities would be required by this measure to establish procedures for the prompt payment of healthcare provider claims. The health plan would be required to determine if the claim is clean within 10 days, to approve or deny claim within 20 days and to pay the claim within another 10 days. If the plan does not comply with these set-time periods, a 12 percent penalty would be added to the amount of the claim to be paid to the provider.

Mandated Benefits

Five states—California, Delaware, Florida, New Hampshire and New York—addressed legislation concerning mandated health insurance benefits. In California, A.B. 1722 passed the Assembly on May 25, 2000 and was assigned to the Senate Committee on Insurance on June 6, 2000. This bill, which was sponsored by Assembly Member Gallegos, would prohibit certain health plans for increasing the cost-sharing requirement for prescription drug coverage during a contact period.

The Senate approved Senator Speier’s bill, California S.B. 1839, and referred the matter to the Assembly Committee on Health on June 6, 2000. This legislation would require specified health benefit plans and disability insurers to provide coverage, on or after January 1, 2001, for routine patient care costs associated with participation in a clinical trial for the treatment of life-threatening prostate cancer. This measure would also require the carriers to annually report to the state on the number of individuals who received coverage due to this legislation.

Also in California, lawmakers took action on another bill sponsored by Senator Speier. S.B. 2046 passed the Senate on May 30, 2000 and was assigned to the Assembly Committee on Health on June 6, 2000. This measure would amend an existing law concerning insurance coverage for FDA-approved drugs, even if a drug was not approved for marketing for the particular indication for which it has been prescribed. This legislation would now allow coverage of such drugs when they are prescribed to treat a chronic and disabling condition.

A Delaware mandate, S.B. 87, passed the House on May 16, 2000. This bill, which was originally sponsored by Senator Henry, would require specified insurers to provide coverage for all FDA-approved prescription contraceptives.

In Florida, the Governor signed Representative Prieguez’s bill, H.B. 399 on June 2, 2000. This new law will, among other things, require certain health insurance carriers and managed care entities to provide coverage for newborn hearing screening and, if needed, referrals for ongoing services.

In New Hampshire, legislation that would require specified insurance carriers to provide coverage for costs associated with participation in certain medical clinical trials was passed by the House on May 18, 2000. The Senate agreed with the House’s amendments to S.B. 409 that same day.

Finally, in New York, Assembly Member Klein’s legislation, A.B. 9676, passed the Assembly Ways and Means Committee and was assigned to the Committee on Rules on June 1, 2000. This bill would require certain HMOs and other managed care entities to provide coverage for end-of-life care.

Medical Savings Accounts

On May 24, 2000 in New Hampshire, H.B. 1510, sponsored by Representative Wendleboe, was sent to a conference committee and both the Senate and House adopted the conference committee report. This measure would establish a medical savings account program for state employees. Funds contributed to the medical savings account must be used exclusively for qualifying medical or surgical care. This program would be contingent on the passage of federal legislation that authorizes the expansion of access to medical savings accounts.

Mental Health and Substance Abuse Parity

Parity legislation was addressed recently in three states—California, New York and South Carolina. In California, S.B. 1764 passed the Senate Appropriations Committee on May 25, 2000 and was read for a second time and amended on the Senate floor. This legislation, which was sponsored by Senator Chesboro, would require the state Legislative Analyst to study existing data on the cost-effectiveness of parity for substance abuse treatment for health benefit plans and disability insurers in the state, among other things. The state Legislative Analyst would be required to submit a report to the Legislature concerning any findings about the cost of substance abuse parity, as well as substance abuse treatment services currently offered by health benefit plans and disability insurers in the state.

Two measures were considered in New York recently. S.B. 4403, by Senator McGee, would prohibit carriers from issuing certain limitations and cost-sharing requirements or limits on the diagnosis and treatment of substance abuse and/or alcohol addictions. This measure passed the Senate Committee on Alcoholism and Drug Abuse on May 23, 2000 and was assigned to the Senate Committee on Rules immediately thereafter.

Also sponsored by Senator McGee was New York S.B. 5189. This legislation would establish minimum reimbursement requirements for specified insurance carriers for chemical dependence services. This mandate would only apply to specific services and levels of treatment. On May 23, 2000, S.B. 5189 passed the Senate Committee on Alcoholism and Drug Abuse and was assigned to the Senate Committee on Rules.

South Carolina House members voted on S.B. 1041 on May 25, 2000. The legislation passed the House and was referred back to the Senate. This bill, which was sponsored by Senator McConnell, would require specified insurers, including the state health insurance plan and group insurers, to provide equal coverage for mental health and substance abuse treatment services as is provided normally for all other physical health conditions.

Uninsured

On June 1, 2000, the Governor of Connecticut signed H.B. 5858 into law. This measure would establish a program to provide prescription drug coverage to low-income uninsured individuals living in the state.